On August 7th, 2024, the Honourable Minister of Finance and Development Planning presented important new regulations in Lesotho’s Parliament. These regulations, known as the Money Laundering (Currency Bearer Negotiable Instruments Declaration) (Amendment) Regulations, 2024, were introduced to strengthen the country’s defences against money laundering and terrorist financing. The proposed regulations were then sent to the Portfolio Committee on the Economic and Development Cluster for further review, as required by parliamentary rules.
The regulations were created to address concerns raised by the Eastern and Southern Africa Anti-Money Laundering Group (ESAAMLAG) and the Financial Action Task Force (FATF), particularly concerning the transportation of currency and negotiable instruments across borders. FATF’s Recommendation 32 emphasizes the need for countries to have measures in place to detect and prevent illegal money flows, which these regulations aim to achieve.
During the briefing, the Ministry highlighted that the proposed regulations are an amendment to the Money Laundering and Proceeds of Crime Act, 2008. They are specifically designed to close gaps in the existing laws that have been identified by ESAAMLAG. The amendments will require every person entering or leaving Lesotho to declare any currency or negotiable instruments they possess if the amount exceeds a threshold set by the Commissioner of Banks.
The regulations also empower authorized officers at Lesotho’s borders to count and inspect the declared currency and instruments. If there is suspicion of money laundering or a related crime, these officers can detain the currency or instruments until further investigation. This measure is seen as crucial in preventing the cross-border flow of illicit funds.
Additionally, if someone fails to declare their currency or negotiable instruments, or if they make a false declaration, the regulations allow for serious penalties. The person could face fines as outlined in the Money Laundering and Proceeds of Crime Act. Moreover, the regulations encourage cooperation between border authorities through the exchange of information and intelligence, enhancing the effectiveness of these anti-money laundering measures.
The Portfolio Committee on the Economic and Development Cluster, after reviewing the proposed regulations, expressed strong support for them. The Committee believes that the regulations are a necessary step in combating money laundering and the financing of terrorism in Lesotho. However, they also suggested that the government could do more to enhance these efforts.
The Committee made several recommendations for further strengthening the regulations. They proposed that the penalties for failing to declare currency or negotiable instruments should be increased to serve as a stronger deterrent. They also stressed the importance of ensuring that border officers are properly equipped and trained to carry out their duties. The Committee recommended that currency scanners be provided at all points of entry to aid in the detection of undeclared funds.
In conclusion, the Committee advised that the proposed regulations should be approved by the Parliament. They believe that these measures, along with their recommendations, will significantly bolster Lesotho’s ability to combat money laundering and related financial crimes.
As the House considers this report, it is clear that the government is taking decisive action to protect the country’s financial system from being misused. The proposed regulations, along with the Committee’s recommendations, represent a comprehensive approach to tackling the complex issue of money laundering and ensuring that Lesotho remains compliant with international standards.
